To explain:
If an individual and his/her friend both watch a movie and like it, whether it is justifiable to say that they both receive same amount of utility.
Explanation of Solution
Even though both individuals liked the movie, this does not mean that both get the same utility levels. The concept of utility differs from person to person. This is because utility depends on the experience or benefit that a person derives from the consumption of goods and services, and these benefits or experiences differs from person to person. Therefore, even though both liked the movie very much,it cannot be said that both the persons are receiving same amount of utility.
Utility:
It is the level of satisfaction that an individual gets after consuming goods and services. The level of utility varies from consumer to consumer and the quantity of commodities and services.
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Chapter 16 Solutions
Principles of Economics (Second Edition)
- Think about a favorite thing you often buy or enjoy. It could be your favorite food, a favorite place to visit, a type of event, or something you make us part of a hobby. As part of this review you will create a chart ( just like the examples of total in marginal utility) showcasing the favorite item. Include the following information: How many you purchase or consume in the course of a day, week, or a month. Marginal utility of additional consumptions The total utility of all consumptions. Let’s assume that the largest utility you get from any one item is 20. Make it as interesting as you can by considering something that is important to you. Fill in the chart. arrow_forwardWho introduced utilityarrow_forward
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